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But he pleaded guilty after being warned by the judge that he could face five years in a civilian prison if he fought the charges and lost.

The 37-year-old soldier was freed in November after appealing against the sentence.

But now the the family, from Crewe, Cheshire, face being made homeless because of the cost of clearing his name.

They had hoped to avoid financial ruin after two anonymous donors promised to help pay legal costs, which could double if the Court of Appeal overturns the conviction and orders a retrial.

One of the donors, who is understood to be a member of a US security company, promised £50,000, while a British businessman said he would “put up” £15,000 for the first appeal. But neither has yet donated any money.

Sgt Nightingale refused to apply for legal aid when he was first arrested, and used his savings instead.

After he was imprisoned in the Military Corrective Training Centre in Colchester, donations from the public raised £40,000, which has been spent on legal fees.

His wife, Sally, said last night: “Money is tight right now but we are not complaining. Danny is free, and that is what we fought for. We are now determined to clear Danny’s name no matter what the cost — you cannot put a price on a person’s reputation.

“Members of the public have been extremely generous, and we thank everyone for all of their donations.”

A close friend of the Nightingales said: “The family are pretty much broke. The lawyers have been very generous and understanding and are not putting the family under any pressure, but bills have to be paid, and Danny will not shirk his responsibility even if that means selling his house.”